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Why Buy an Existing Business?

In the last post we shared this reality: Data from U.S. Small Business Administration shows the majority of start-ups go out of business within 5 years. Usually we hear around 80%.

If you aren’t sure about taking on such risk, let’s look at another option. Buying an existing business.

What are some advantages to buying an existing business?

  • Actual sales vs. projections
  • Already operating means immediate cash flow
  • Established customer base
  • Established vendor/supplier relationships
  • Existing equipment/inventory in place
  • Employees trained in the business practices and policies
  • Existing licenses and permits
  • Training by the seller during the transition process
  • Seller financing may be an option
  • Focus on growth rather than creating an entire brand from beginning stages

There is still a lot of time, money, and effort involved in running your own business. But there is a better chance for success with buying an existing business vs. a new start-up.